Hesai Turns Profitable but Tomorrow's Call Will Reveal Whether Lidar Economics Actually Work

Hesai Group (HSAI) reports first quarter 2026 earnings tomorrow, May 19, before market open, with management hosting a conference call at 8:00 AM ET. The global leader in intelligent technology and 3D perception faces a critical test as investors assess whether the company can sustain the profitability momentum established in recent quarters. With the stock trading below all major moving averages and technical signals flashing caution, the earnings release will determine whether HSAI can reverse its recent weakness or faces further downside pressure.

Part 1: Earnings Preview

Hesai Group is a global leader in intelligent technology and 3D perception, specializing in lidar sensors and solutions for autonomous vehicles and advanced driver assistance systems. The company serves automotive manufacturers and technology companies worldwide, positioning itself at the forefront of the autonomous driving revolution.

Hesai reports Q1 2026 earnings tomorrow, May 19, before market open. The company most recently reported Q4 2025 earnings of $0.13 per share, marking its fourth consecutive quarter of profitability. While no consensus estimates are available for the upcoming quarter, the company posted -$0.02 per share in Q1 2025, suggesting year-over-year improvement as Hesai continues its path toward sustained profitability.

For full-year 2026, analysts project earnings of $0.65 per share (ranging from $0.47 to $0.83), representing 51.16% growth over the prior year's $0.43. Looking further ahead, 2027 estimates call for $1.19 per share (ranging from $0.94 to $1.44), implying 83.08% growth as the company scales its operations.

Three key themes define this earnings story:

Profitability Trajectory: After turning profitable in Q2 2025, Hesai has delivered four consecutive quarters of positive earnings, with Q3 2025's $0.25 representing the strongest performance. Investors will scrutinize whether Q1 2026 maintains this momentum or shows seasonal weakness, particularly given the -$0.02 result in the year-ago quarter.

Revenue Growth and Market Penetration: The company's quarterly revenue has ranged from $72 million to $143 million over the past year, with significant volatility. The Q1 report will reveal whether Hesai can stabilize revenue growth as automotive production cycles normalize and lidar adoption accelerates across its customer base.

Margin Expansion and Operating Leverage: With analysts projecting substantial earnings growth through 2027, the key question is whether Hesai can demonstrate improving unit economics and operating leverage as it scales production. The company's ability to translate revenue growth into expanding profitability will be critical for justifying its current valuation of 31.91x forward earnings.

Part 2: Historical Earnings Performance

Hesai's recent earnings history reveals a company in transition from losses to profitability. The progression from -$0.02 in Q1 2025 to $0.04 in Q2, $0.25 in Q3, and $0.13 in Q4 demonstrates meaningful improvement, though with notable quarter-to-quarter volatility.

The Q3 2025 result of $0.25 stands out as the strongest performance, more than double the Q4 figure, suggesting potential seasonality or project timing effects in the business. The sequential decline from Q3 to Q4 (from $0.25 to $0.13) raises questions about whether Q1 2026 will show further moderation or return to growth.

Comparing to the year-ago quarter, the company has made substantial progress—moving from a -$0.02 loss in Q1 2025 to sustained profitability throughout 2025. This transformation reflects improving operational efficiency and scale benefits as the lidar market matures. The upcoming Q1 2026 report will test whether this profitability is sustainable or subject to seasonal pressures that affected the year-ago period.

Note: These figures reflect diluted GAAP earnings per share, reported before non-recurring items, and may differ from the non-GAAP figures used by some sources.

Part 2.1: Price Behavior Around Earnings

Hesai typically reports before market open, meaning Day 0 captures the first full trading session reaction while Day +1 reflects follow-through momentum.

Hesai exhibits significant post-earnings volatility, with an average absolute Day 0 move of 5.47% and Day 0 range of 8.65%. The Day +1 action is even more dramatic, averaging 18.85% absolute movement with ranges of 22.08%, indicating that the market often takes a full session to digest results before making larger directional moves.

The most recent earnings on March 24, 2026, saw a sharp -14.16% Day 0 decline followed by modest -1.93% Day +1 movement, suggesting immediate disappointment that stabilized quickly. In contrast, the March 2025 report produced an extraordinary +50.41% Day +1 surge after an initial -8.15% Day 0 drop—a pattern of initial selling followed by aggressive buying.

The historical pattern shows mixed Day 0 reactions but consistently large Day +1 moves, with several instances exceeding 40% (November 2024's +44.42% and March 2025's +50.41%). This suggests investors should expect substantial volatility extending beyond the initial reaction, with the potential for significant reversals or momentum continuation in the session following the report.

Part 2.2: Options Market Expected Move

The options market is pricing an expected move of 17.57% (±$3.87) for the June monthly expiration, which aligns closely with the stock's average historical Day +1 absolute move of 18.85% but significantly exceeds the Day 0 average of 5.47%. This suggests options traders are anticipating volatility consistent with Hesai's historical pattern of delayed, substantial reactions rather than immediate Day 0 resolution.

Part 3: What Analysts Are Saying

Analysts maintain a bullish stance on Hesai Group, with an average recommendation of 4.67 out of 5.00—firmly in Strong Buy territory. The consensus includes 9 Strong Buy ratings, 2 Moderate Buys, and 1 Hold, with no sell ratings among the 12 analysts covering the stock.

The average price target of $31.61 implies 43.6% upside from the current price of $22.01, with estimates ranging from a low of $27.00 (+22.7%) to a high of $36.00 (+63.6%). This wide range reflects differing views on the company's growth trajectory and market penetration potential, though even the most conservative target suggests meaningful appreciation.

Analyst sentiment has remained unchanged over the past month, with the same 4.67 average recommendation and identical rating distribution. This stability suggests analysts are waiting for the Q1 results to reassess their views rather than making preemptive adjustments. The strong consensus and substantial upside targets indicate confidence in Hesai's long-term prospects, though the stock's recent weakness suggests the market is taking a more cautious wait-and-see approach heading into the report.

Part 4: Technical Picture

Hesai enters earnings in a technically challenged position, with the Barchart Technical Opinion registering a 72% Sell signal—though this represents improvement from last week's 80% Sell reading. The signal has deteriorated significantly from last month's 32% Sell, indicating mounting technical pressure over the intermediate term.

At $22.01, the stock trades below all major moving averages: the 5-day ($22.70), 10-day ($22.26), 20-day ($22.17), 50-day ($22.29), 100-day ($24.05), and 200-day ($23.81). This universal resistance suggests a stock in a clear downtrend with no nearby technical support from moving averages.

Timeframe Analysis:

• Short-term (100% Sell): Maximum bearish signal indicates immediate-term momentum is decidedly negative
• Medium-term (100% Sell): Equally bearish intermediate reading confirms weakness extends beyond near-term noise
• Long-term (50% Sell): Moderate sell signal shows the longer-term trend is less decisively negative, suggesting potential stabilization

Trend Characteristics: The Weak Strongest characterization indicates a trend environment with limited conviction despite directional clarity, suggesting vulnerability to reversal on positive catalysts.

The stock's 60-month beta of 1.50 amplifies market movements, meaning any earnings-driven volatility will likely be magnified. With total open interest of 7,989 contracts in the June expiration and average implied volatility of 88.48%, options positioning reflects elevated uncertainty.

The technical setup heading into earnings is cautionary, with the stock trapped below all moving averages and facing resistance at the $22.17-$22.70 zone. The 50-day moving average at $22.29 represents the first meaningful hurdle, while the 100-day at $24.05 and 200-day at $23.81 form a more substantial resistance cluster. However, the improvement in the Barchart signal from 80% to 72% Sell over the past week, combined with the less bearish long-term reading, suggests the selling pressure may be exhausting. A strong earnings beat could trigger a technical reversal, particularly given the stock's history of explosive post-earnings moves, but the current setup favors caution with limited technical support until the $18-$19 area based on recent trading ranges.